Come on a Lein
An encumbrance on (claim against) property to satisfy a debt or protect a claim for the payment of a debt
What is a lien
Mortgage
What is a written instrument that gives the creditor a lien on the debtor’s real property as security for payment of a debt
The primary difference between a suretyship and guaranty
What is a surety is primarily liable and a guarantor is only secondarily liable
Exemption statutes are provided solely under federal bankruptcy law
What is False
Automatic Stay
Suspension of all actions of creditors against the debtor
requirements for attachment
1. debtor has rights in collateral
2. Creditor gave value
3 Either possession or written security agreement
A furnace repairman repairs a furnace at the Jones residence. The Jones fail to pay the repariman. If the repairman obtains a lien against the real property, this is called
What is a mechanic's lien
A type of mortgage that shifts the risk of changing interest rates to the borrower
What is an adjustable rate mortgage
This one has to be in writing under the statute of frauds
What is a guarantee
Homestead
What is each state permits the debtor to retain the family home—either in its entirety or up to a specified dollar amount—free from the claims of unsecured creditors or trustees in bankruptcy
Number of creditors that need to file for an involuntary bankruptcy
If 12 or more creditors: at least 3 with debt totaling $18,600
If fewer than 12: one or more with claims totaling $18,600
Difference between attachment and perfectionism
Attachment: gives creditor rights in debtor's collateral
Perfection: gives creditor priority over other creditors
See video. If Clark fails to pay the mechanic, the mechanic may be able to retain the family truckster under which of the following:
a mechanics lien
an artisan's lien
a judicial lien
What is an artisan's lien
Charging the borrower an extra fee for paying off the loan prior to its due date
What is a prepayment penalty
Two of the three ways that will release a surety or guarantor
What is material modification, surrender of property or payment
Name three other types of exempt property
What is household furniture, clothing, trade tools, livestock, pets, vehicle
Powers of Bankruptcy Trustee include
Strong arm power: power to assert rights of the debtor
Power of avoidance: set aside sale or transfers of the debtor and take back property
How to perfect a security interest
1. file financing statement
2. possession
3. automatic
The difference between a writ of attachment and a writ of execution
What is the writ of attachment is obtained prior to the judicial hearing on the debt
In order to get protection against subsequent mortgages, the lender must do this
What is record the mortgage
Defenses to surety and guarantor include which of the following: incapacity of the debtor or bankruptcy of the debtor
What is neither provide a defense
Exempt property are exempt from which: writ of attachment, writ of execution, both or neither.
What is both
What is means testing
Test in chapter 7 to see if debtor qualifies. Two part test. 1: if below median income and if not; 2: calculation of disposable income available to pay unsecured debts.
Example of most common automatic perfectionism
What is PMSI in consumer goods
See Video [what is a garnishment]
What is an order that permits a creditor to collect a debt by seizing property of the debtor that is being held by a third party
The right to pay off the debt and take the property back after foreclosure
What is redemption
Subrogation
What is any right that the creditor had against the debtor now becomes the right of the surety
: If a state has a $25,000 homestead exemption and a debtor has property worth $30,000 and a mortgage with Bank for $20,000, can the Bank force sale of the property and if so, how much would Bank recover if sold for $30,000.
What is yes and $20,000
Three types (numbers) of bankruptcy and what are they for:
Chapter 7: straight or liquidation bankruptcy
Chapter 11: Reorganization
Chapter 13: Repayment plan
If sale of collateral is insufficient to satisfy debt owed to secured party what happens?
Balance is now just unsecured debt. Can take action of other creditor (get deficiency judgment, force bankruptcy, etc).